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Japan’s Financial Watchdog Seeks to Regulate Unregistered Crypto Investment Firms

Japan's Financial Services Agency is considering the regulation of unregistered firms that solicit investments in cryptocurrencies. Japan's Financial Services Agency (FSA) is considering the regulation of unregistered firms that solicit investments in cryptocurrencies, Cointelegraph Japan reports on Jan. 8. The development is reportedly a bid to close a loophole in the country’s existing regulatory framework, in which unregistered firms that collect funds in crypto rather than fiat currencies remain in a gray zone. This situation exists because these firms do not explicitly come under the purview of Japan’s Financial Instruments and Exchange Act, which prohibits unregistered companies from collecting investment funds in cash, but fails to mention funds collected in cryptocurrency form. As CT Japan notes, the impetus for reconsidering the current status of such firms was thrown into relief last fall, when Tokyo police arrested eight men suspected of operating a pyramid scheme..

US Court Dismisses SEC’s Claims That Blockvest Sold Unregistered Securities

A California federal court judge ruled that “at this stage” he could not “determine” whether blockchain firm Blockvest’s BLV tokens were securities. A U.S. court has dismissed claims from regulator Securities and Exchange Commission (SEC) against decentralized blockchain-based assets exchange Blockvest, court documents released Nov. 27 confirm. The SEC suspended Blockvest’s Initial Coin Offering (ICO) via an emergency court order in October, with a subsequent legal battle ensuing over whether or not the firm’s BLV tokens were in fact unregistered securities under U.S. law. Part of multiple investigations into unregistered token sales by the regulator, the SEC’ retaliation initially saw U.S. District Court for the Southern District of California issue a temporary asset freeze against Blockvest. In a fresh development this week, however, the court ruled that the SEC had “failed” to adequately demonstrate that the tokens in question were in fact securities, according to the Howey Test. “..

US SEC Levies ‘First’ Civil Penalties Against Two ICOs for ‘Unregistered’...

In a self-described “first,” the U.S. SEC has imposed civil penalties against two ICOs solely over their failure to register their token sales. In a self-described “first,” the U.S. Securities and Exchange Commission (SEC) has imposed civil penalties against two Initial Coin Offerings (ICOs) solely over their failure to register their token sales, according to an official Nov. 16 press release. The SEC states it has reached settlements with two ICO companies, CarrierEQ Inc. (Airfox) and Paragon Coin Inc., both of whom reportedly conducted their token sales last year after the SEC had already “warned” that ICOs could be deemed securities offerings in its July 2017 DAO Report of Investigation. The nature of the settlements require both companies to “return funds to harmed investors, register the[ir] tokens as securities, file periodic reports with the Commission, and pay penalties” of $250,000 each. The enforcement action implies that both Airfox and Paragon’s tokens were judged to have..

US SEC Charges, Fines EtherDelta Founder with Operating Unregistered Securities Exchange

U.S. securities watchdog charges Zachary Coburn, founder of crypto trading platform EtherDelta, with operating an unregistered exchange. The U.S. Securities and Exchange Commission (SEC) has charged Zachary Coburn, the founder of crypto token trading platform EtherDelta, with operating an unregistered securities exchange, a press release by the SEC reveals Thursday, Nov. 8. EtherDelta, which served as a secondary marketplace for trading ERC20 tokens, allows its users to buy and sell digital assets by means of an order book and smart contracts based on the Ethereum blockchain. According to the SEC, over an 18-month operating period, EtherDelta's users placed more than 3.6 million orders for tokens, including ones that are considered securities by U.S. federal laws. The regulator notes that most of the orders were executed after the DAO report that SEC had released in June 2017. Under the current law, EtherDelta was obliged to register in U.S. or to apply for an exemption; however,..

Thai SEC Warns Public About Investing in Nine Unregistered Tokens and...

The Thai Securities and Exchange Commission has warned the public about investing in nine unapproved digital tokens and ICOs. The Thai Securities and Exchange Commission (SEC) has issued a warning about investing in nine digital tokens and Initial Coin Offerings (ICOs), which have not been accredited by the regulator, news outlet Bangkok Post reported Oct. 26. The SEC reportedly initiated an investigation into digital tokens and ICOs being promoted on social media platforms for investment, and found nine cases wherein promoted digital assets had not been authorized by the market regulator. Per the SEC, the alleged digital assets and ICOs have neither filed an application for the SEC’s approval, nor have they met the necessary qualifications and had smart contracts assessed by ICO portals. The SEC said that those who have invested in the alleged assets should be wary of associated investment risks. The SEC reportedly reiterated a warning about Ponzi schemes that persuade people to inve..

Police Arrest Indian Crypto Exchange Co-Founder for Unregistered ‘Illegal’ Bitcoin ATM

Police have seized an allegedly unregistered Bitcoin ATM machine in India and arrested its owner, the co-founder of domestic crypto exchange Unocoin. The co-founder of Indian crypto exchange Unocoin has been arrested shortly after setting up an allegedly unregistered Bitcoin (BTC) ATM machine in Bangalore, English-language daily Times of India reports Oct. 24. The 37-year-old co-founder, Harish BV, was apprehended by police after having reportedly installed the ATM kiosk at Kemp Fort Mall on Old Airport Road, together with fellow Unocoin co-founder Sathvik Viswanath. The latter has not been arrested, as per media reports. Indian business magazine Business Today (BT) cites a press statement from the Central Crime Branch (CCB), which claims the ATM installation did not receive “any permission from the state government and is dealing in cryptocurrency outside the remit of the law." CCB officials are further reported to have seized “a teller machine, two laptops, a mobile, three credit ca..

FINRA Charges Broker With Fraud for Trading Unregistered Cryptocurrency

FINRA has charged Timothy Ayre with securities fraud and the illegal distribution of HempCoin, which he failed to register. The U.S. Financial Industry Regulatory Authority (FINRA) has filed a complaint against Timothy Tilton Ayre, charging him with securities fraud and the illegal distribution of an unregistered cryptocurrency, according to a statement released on FINRA’s website Tuesday, September 11. In the complaint, FINRA, overseen by the U.S. Securities and Exchange Commission (SEC), states that Massachusetts-based Ayre tried to lure investment to his public company, Rocky Mountain Ayre, Inc. (RMTN), by selling HempCoin, which he misrepresented as “the first minable coin backed by marketable securities.” The regulator writes that Ayre’s claims are “fraudulent, positive statements about RMTN’s business and finances.” Furthermore, Ayre stated that HempCoin is a security backed by RMTN common stock, telling investors that each coin was equivalent to 0.10 shares. As a result, more t..
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